ISLAMABAD: The developers of Pakistan’s landmark 1,124 MW Kohala hydropower project have formally requested a two-year extension of their Letter of Support (LoS) until September 2027, citing the need to safeguard the country’s water rights under the Indus Waters Treaty (IWT).
The $2.5 billion run-of-river project on the Jhelum River represents one of Pakistan’s largest foreign investments in clean energy and a strategic assertion of its water entitlements under the 1960 World Bank-mediated agreement with India.
Defending Pakistan’s Water Sovereignty
Kohala Hydro Company Limited (KHCL) CEO Liu Yonggang emphasized the project’s critical role in cementing Pakistan’s legal claims to Western Rivers’ waters under IWT Article III.
The treaty explicitly grants Pakistan rights to harness the Jhelum, Chenab and Indus rivers for hydroelectric generation – a provision the Kohala project strategically operationalizes through its planned diversion weir and 22 km tunnel system.
With India accelerating its own hydropower projects on shared rivers, the extension would allow Pakistan to maintain parity in exercising its water entitlements while securing crucial Chinese investment under CPEC’s energy framework.
Project Timeline and Strategic Importance
Originally awarded in 2018, the project by China Three Gorges Corporation has faced delays due to:
Complex financing arrangements involving Chinese banks
COVID-19 disruptions to international supply chains
Ongoing technical studies on sediment management
The 2027 extension would provide breathing room to:
Finalize $1.8 billion in debt financing
Complete detailed engineering designs
Secure remaining regulatory approvals
Commence construction on the Azad Jammu & Kashmir site
Energy analysts note the project’s completion would not only add 5 billion kWh of annual clean electricity but also establish a legal precedent strengthening Pakistan’s position in future water disputes with India.
